Wall Street: Stocks open sharply lower as US nears shutdown

FILE - In this Nov. 14, 1995, file photo, Mike Fetters afixes a closed sign on a door at the Smithsonian's Air and Space Museum in Washington as parts of the federal government were shutdown due a federal budget impasse between President Clinton and the Republican Congress. Moments later, the sign was taken down and the museum opened as all Smithsonian museums in Washington were told from their headquarters to stay open until further notice. OK, gridlocked politicians we're used to. But why padlock the Statue of Liberty? You don't see other democracies shuttering landmarks and sending civil servants home just because their political parties can't get along. The potential for a shutdown is a quirk of American history. So if you're tired of blaming tea party Republicans or President Barack Obama, you can lay some responsibility on the Founding Fathers. Or blame Jimmy Carter. Or Newt Gingrich's temper tantrum. A quick history of government shutdowns, American-style. (AP Photo/Doug Mills, File)

President Barack Obama pauses while making a statement regarding the budget fight in Congress and foreign policy challenges, Friday, Sept. 27, 2013, in the James Brady Press Briefing Room of the White House in Washington. The president said the debt ceiling breach far worse than a government shutdown and would effectively shutter economy. (AP Photo/Charles Dharapak)

NEW YORK — The U.S. stock market dropped early Monday as it became all but certain that the federal government would partially shut down for the first time in 17 years.

In the first 15 minutes of trading, the Dow Jones industrial average dropped 142 points, or 0.9 percent, to 15,124. The Standard & Poor’s 500 slid lost 12 points, or 0.7 percent, to 1,680 and the Nasdaq composite dropped 34 points, or 0.9 percent, to 3,748.

Selling was broad in early trading as all 30 companies in the Dow fell.

Wall Street’s attention is on Washington. Congress and the White House have not reached an agreement to pass what’s known as a continuing resolution to fund the government, with only hours before the midnight deadline. If the government does partially close, it would be the first time since the 21-day government shutdown under President Bill Clinton from late December 1995 to January 1996.

Political brinksmanship, particularly the type between the White House and the Republican-controlled House of Representatives, is old news for Wall Street traders. The last several budget and debt-ceiling debates between the Obama administration and Republican-controlled House of Representatives have gone until the last minute, with legislation often passing with only hours to spare.

Investors have said they expected volatility over the next few weeks because of the shutdown and upcoming debate over the debt ceiling.

As long as the shutdown is not prolonged, any volatility should be temporary. The bigger worry is the problem with the debt ceiling, investors said.

Treasury Secretary Jack Lew said last week that the federal government would run out of borrowing authority by roughly Oct. 17. The last time the debt ceiling issue came up in August 2011, it led to Standard & Poor’s downgrading the United States’ credit rating and the Dow went through nearly three weeks of nauseating triple-digits moves almost daily.